A third of East Anglians relying on savings to get them through the cost of living crisis

New research from the Building Societies Association (BSA), reveals that the average person in the UK has £17,356 tucked away in savings. However, as always, average figures conceal the gap between the ‘haves’ and the ‘have-nots’, with one in seven (13%) saying they have no savings at all. 

• One third (34%) of savers said that they are relying on their savings to get them through the cost-of-living crisis.
• More than half (55%) have reduced the amount they used to save, meaning financial resilience is diminishing every day for many people.
• More worryingly, over a third (36%) have stopped saving altogether as a result of the crisis.
• One in five (22%) of savers say that if they lost their income they wouldn’t have enough savings to cover their living costs for even just one month.

Richard Norrington, CEO, Suffolk Building Society said: “As the BSA’s research highlights, and as is very much evident in our home county, the average savings statistics mask the bleak outlook for many people.”

The BSA is using its inaugural UK Savings Week (which runs from 26 September to 2 October 2022) to get people engaged with saving, whether they are already savers, have no savings but could save a little, or may be unable to save right now but may be able to when times improve.

Despite the financial pressures caused by the rising cost of living, it is encouraging that over three-quarters of those in East Anglia (77%) with no savings said they could save £10 a month, which could help these individuals to build a safety net for an unexpected cost.

Creating a regular habit is often the best way to start saving, even if the amount saved flexes depending on other expenses in the month.

With so many people currently relying on their savings, it’s probably never been more important to find the best deals available, however there is currently more than £260 billion in UK accounts paying no interest. This is not surprising as the research found that around one in four (25%) of East Anglian savers don’t check the interest rate paid before they open an account, with a third (31%) never comparing the rate on their savings to other accounts available.

Richard Norrington continued: “We’re fully behind the efforts of our industry body, the BSA, in highlighting the importance of saving. However, they and we know that saving isn’t for everyone right now. Most, if not all, people will wish they had a larger pot of money to rely on as the cost of living continues to increase, so even if people can’t afford to save immediately, we hope to plant the seed of an idea that they might be able to return to when their household budget allows. Having a regular savings habit can provide a safety net when things go wrong and even a small rainy-day pot can give great peace of mind.

“For current savers, however, it’s important to ensure that with interest rates continuing to rise, their savings account is receiving a competitive rate of interest. The BSA research highlights just how many people don’t check their rate on new or existing accounts which means they will be missing out on valuable interest. Of course, as interest rates have been historically so low, this hasn’t been a recent issue, but as they start to rise, savers could be missing out.”